We use cookies to customise content for your subscription and for analytics.If you continue to browse Lexology, we will assume that you are happy to receive all our cookies. For further information please read our Cookie Policy.

Workplace Watch - Issue 9, December 2015

Workplace Watch is a quarterly publication tracking legislation and regulatory reform in relation to workforce and workplace law. Our national team of employment specialists can assist you in all areas of employment law, including personal grievances, litigation, union issues (negotiations, disputes and mediations), redundancies, restructuring, senior executive employment, exit negotiations, post-employment conduct, and health and safety.

Employment law

Holiday pay, Christmas closedown, Christmas parties

The Ministry of Business, Innovation and Employment (MBIE) has posted advice on its website to cover the Christmas-summer holiday period.

Holiday pay and entitlements

Employees are entitled to a paid day off on a public holiday if it would otherwise be a working day. If public holidays fall inside a business’s annual closedown period, businesses must pay employees for them if they are on days employees would usually work.

Notably, this Christmas season has two public holidays – Boxing Day and 2 January which fall on a Saturday. For staff who don’t work weekends, the first workday after these dates will be treated as their public holidays; they won’t have to work on Monday 28 December 2015 or Monday 4 January 2016. If businesses treat casual workers like part-time staff, for example give them regular hours, this is a breach of employment law. Casual work is intermittent or irregular, and casual employees don’t have to accept every offer of work made.

Businesses may be able to claim as business expenses, events such as Christmas functions or giving gifts to employees. But they may not be able to claim all of the costs and costs may also be subject to fringe benefit tax (FBT). Party expenses for which businesses can claim 50% can include venue hire, food and drink, and entertainment. 100% of the cost of gifts such as food baskets or event tickets can generally be claimed as a business expense, but businesses may need to pay FBT on such gifts.

The government has appointed a Joint Working Group comprising union and employer representatives to recommend a set of agreed principles for resolving pay equity claims under the Equal Pay Act.

The decision takes the issue out of the legal and into the political arena. The Court of Appeal had referred the matter to the Employment Court after accepting in the Terranova case that the Act anticipated that comparisons between male and female dominated occupations across different industries and workplaces.

Unions have agreed to put on hold any legal action until March 2016 to allow the Working Group to proceed. It is expected to deliver its recommendations before the end of March.

The New Zealand Educational Institute (NZEI) had lodged a claim in October against the Ministry of Education alleging gender based pay discrimination against education support workers. Their wage scale starts at $16.04 an hour, rising to $19.48 after eight years’ service. An independent job evaluation by the Pay and Employment Equity Unit in 2009 suggested that these rates were as much as $8 an hour less than for a comparable male-dominated occupation.

Meanwhile, the government has entered negotiations to resolve the dispute in the aged care and disability sector.

The National Council of Women has produced a white paper – Enabling women’s potential: the social, economic and ethical imperative – which outlines what a gender equal New Zealand might look like and suggests 12 actions to progress these qualities.

The government has accepted ACC’s recommendations with the effect that the average work levy will be cut by 11%, the earners’ levy by 4% and average motor vehicle levies by 33%.

In response to public submissions, ACC also recommended a new allocation to the vehicle levy so that more would come from petrol (56% compared to 44% now) and comparatively less from registration fees. The petrol levy would remain at 6.9c a litre through 2016-2017. This recommendation has been accepted but the government is not yet persuaded that the change in apportionment should be permanent. It will investigate the issue and the implications in the coming year.

Company fined although breach had no “direct causative link” to accident

Electrix Ltd has been fined $22,500 for an accident in which one of its employees was killed and another seriously injured after a specialist lifting vehicle fitted with a “man cage” tipped over on the Makara hills as they were working on overhead pylons attached to the Cook Strait cable. The equipment was hired by Transfield from NZ Crane Group.

The Ministry of Business, Innovation and Employment (MBIE) took proceedings against Electrix and against NZ Crane.

Electrix

The High Court accepted that “nothing done or omitted by Electrix was directly causative of the accident”, that its workers were working under the overall supervision and direction of Transfield at the time and that Transfield was known to have “thorough health and safety regimes”.

However it said that Electrix had fallen “substantially short of its obligations” by not satisfying itself through direct enquiry and site inspection that the workplace was safe.

“The point is not that, had it done these things, Electrix would have discovered the hazard inherent in the set-up of the telehandler’s rear axle…It is that it was content not to do them, relying solely on the expertise and knowledge of Transfield… It had a non-delegable duty to take the practicable steps available to it; it did not take those steps.”

NZ Crane

The Court accepted that NZ Crane was dependent on the manufacturer of the telehandler for instructions about its use and that it had supplied all the information it had in its possession to Transfield. It acknowledged that this might be standard industry practice which

it would be hard for NZ Crane to change. But it said that NZ Crane should have insisted upon more robust arrangements given that criminal liability lay with it as the local agent.

Penalties

The starting point was $50,000 for Electrix and $15,000 for NZ Crane. Both companies got a 40% deduction for mitigating factors and a 25% deduction for making an early guilty plea. This produced fines of $22,500 and $6,750 respectively.

An expensive vent

Bragging about an exit settlement in a manner which breached the confidentiality of the agreement has led to the former employee having to effectively return $3,000 of his $4,500 compensatory payment to his former employer – Bidvest New Zealand Ltd.

The man bragged through Facebook to a current Bidvest staff member that “at least I got paid a lot of money to leave even though I was going to quit the next week”. The company sought a compliance order and a penalty because it was concerned that the brag would encourage other employees to seek similar payments when they left.

The Court agreed that he had breached a confidential provision and ordered him to pay $3,000 to Bidvest.

Not guilty of manslaughter but large financial penalties

Paul Burr, the forestry contractor who crushed a young employee, Lincoln Kidd, to death under a falling tree was acquitted of manslaughter but has been ordered to pay $75,000 in reparations to Kidd’s family and has been fined $25,000. The Court acknowledged that Burr’s company was in liquidation and that his financial position was “dire” but said the fine would be a deterrent to others. Burr had not checked his employee’s location before felling the tree and had failed to provide efficient communication on site by using personal cell phones over radios.

Compare jurisdictions: Employment: International

"I have enjoyed receiving the Lexology newsfeeds over the last few months and in general find the articles of good quality and relevant. I like the fact that the email contains a short indication of the subject matter of the articles, which allows me to skim the newsfeed very quickly and decide which articles to read in more detail."